Questions and Answers – March 1

Press Release – Office of the Clerk

1. KANWALJIT SINGH BAKSHI (National) to the Minister of Finance : How does the outlook for the New Zealand economy compare with other developed countries?
Questions to Ministers

Economic Outlook—Other Developed Countries

1. KANWALJIT SINGH BAKSHI (National) to the Minister of Finance: How does the outlook for the New Zealand economy compare with other developed countries?

Hon BILL ENGLISH (Minister of Finance): Reasonably good. New Zealand businesses are confident and backing themselves, despite some global uncertainty. Exporters who were forced to become more efficient when the exchange rate was around 88c are now able to reap the rewards of a much lower exchange rate. The manufacturing sector has notched up 40 straight months of expansion, and the services sector, which makes up 70 percent of the economy, has been growing at the fastest level in 7 years. Treasury forecasts that growth will be around 3 percent over the next 2 years, similar to Australia and a bit faster than the US, Canada, and the UK.

Kanwaljit Singh Bakshi: How is the positive economic outlook translating into more jobs and higher income for New Zealand families?

Hon BILL ENGLISH: In the last year the annual average wage increased by 3.1 percent, much faster than inflation, and by 2020, at moderate rates of increase, it will reach over $63,000. Against this background, the Government announced an increase in the minimum wage yesterday, up 50c an hour to $15.25 an hour, which will directly benefit over 150,000 workers. This 3.4 percent increase in the minimum wage is significantly more than the cost of living increase, which is 0.1 percent.

Kanwaljit Singh Bakshi: What risks are there to New Zealand’s economic outlook?

Hon BILL ENGLISH: With reasonable pace of growth and real wage rises for many New Zealanders, domestic results are reasonably strong despite ongoing wobbles in the global economy. There is uncertainty around the impact of US interest rate hikes, risks around European banks, and always some uncertainty about the nature of the changes in the Chinese economy. However, New Zealand is relatively well positioned to deal with what we would regard as the normal spread of risk in the global economy.

Kanwaljit Singh Bakshi: What steps is the Government taking to mitigate risk and continue to support our growing economy?

Hon BILL ENGLISH: One way this Government and previous Governments have taken steps to mitigate risks is through the negotiation of a network of free-trade agreements. The importance of the Trans-Pacific Partnership agreement is so high because it gives us better access to 800 million customers in 11 countries and accounts for 36 percent of the global economy. We believe the benefits that have been calculated for this agreement are conservative, based on the success of the most recent free-trade agreement negotiated by the previous Labour Government, the Chinese free-trade agreement.

Housing, Rental—Impact of Residential Tenancies Amendment Bill

2. METIRIA TUREI (Co-Leader—Green) to the Minister for Building and Housing: Will the Residential Tenancies Amendment Bill guarantee that no New Zealand renter will live in a cold, damp, mouldy house that makes them sick; if not, why not?

Hon Dr NICK SMITH (Minister for Building and Housing): This bill will make 180,000 homes warmer, drier, and safer without imposing excessive compliance costs on landlords that would inevitably be passed on to tenants. The bill requires that all rental properties have a smoke alarm by 1 July this year and that they are progressively insulated over a period of 3 years. No bill provides an absolute guarantee; it is as foolish as pretending that our criminal laws prevent all murders or that our road safety laws prevent all motor accidents. [Interruption]

Mr SPEAKER: Order! Can I just, before I call the member, mention the level of interjection. We have been away for a week, so I would expect some level of interjection, but if it is going to be disruptive then I will start naming members, mentioning their names, and then, if it continues beyond that, I would, with regret, be asking some members to leave.

Metiria Turei: Will the Minister take the advice of the Child Poverty Action Group and include a rentals warrant of fitness in the Residential Tenancies Amendment Bill to provide a more comprehensive improvement in the warmth, the dryness, and safety of rental houses?

Hon Dr NICK SMITH: There are two problems with the warrant of fitness proposal. I am advised by officials that it would cost $225 per home, or $100 million per year, just for the compliance and the administration, without fixing a single house. The second concern I have is the pedantic nature of having “Clipboard Charlies” putting in unreasonable requirements. For instance, if I look at the member’s own bill, it would assess my Beehive office as unsafe, because I do not have a safety strip on my window or my flap, and I do not think that is reasonable. The third part is, of course, that any cost that you impose actually goes on to rents, and if you are going to put $225 on the cost of every rental property in New Zealand, that is actually a cost that will impact on the very families that we should be helping.

Metiria Turei: What, then, is the cost of the lives of the 15 children who die each year from poor housing and the 42,000 child admissions to hospital each year from cold, damp housing and poverty?

Hon Dr NICK SMITH: This Government has made more progress on getting our homes insulated than any other Government in history. That is why we have a bill before the House that is going to require all homes to be insulated by 1 July and to require a smoke alarm, because there are too many New Zealanders who die unnecessarily as a consequence of the lack of those things. What we are not going to do is impose a massive bureaucracy that will impose costs on the very families that we are trying to help.

Metiria Turei: I raise a point of order, Mr Speaker. The Minister referred to the cost of a warrant of fitness scheme. I asked him the financial cost of the deaths of 15 children and the 42,000 child hospital admissions. He did not answer that question—

Mr SPEAKER: Order! And nor could you expect a Minister to do that. When you consider that it is a supplementary question, I do not think the member could rightfully expect the Minister to put a dollar value on to 15 deaths and what I think was 40,000 hospital admissions. The question was without doubt addressed.

Metiria Turei: Has the Minister sought any advice on the cost of 15 child deaths and the 42,000 child admissions to hospital caused every year by cold, damp housing?

Hon Dr NICK SMITH: Yes, I have. There has been extensive cost-benefit analysis on the Government proposals. The analyses showed that a warrant of fitness imposed more cost than benefit, and that the proposal that we have in the bill is the best way in which we can address the very issues that the member is concerned about.

Joanne Hayes: What progress has been made in improving home insulation over the past 15 years?

Hon Dr NICK SMITH: The previous Government managed to do 2,000 home insulations per year, or 18,000 over its 9 years. We firstly put a focus on insulating those 30,000 State houses. We then provided for Warm Up New Zealand: Heat Smart and Warm Up New Zealand: Healthy Homes, which provided for 290,000 houses. This bill provides for a further 180,000 houses, a total of 500,000. I do find it a bit rich for members opposite, who did less than 20,000, to criticise this Government for doing 500,000.

Metiria Turei: I raise a point of order, Mr Speaker. The Minister was not required to answer my initial question on the costs of deaths and child admissions because he did not have the information. He just admitted that he does have—

Mr SPEAKER: Order! The question was whether the Minister had sought any advice. His very first answer was yes, he had sought advice on that issue. Without doubt the question was answered.

Hon Dr NICK SMITH: To help the House, because there have been some questions about the cost-benefit analysis, a review has been done by Arthur Grimes, and I seek the leave of the House to table that review of the cost-benefit analysis.

Mr SPEAKER: Leave is sought to table that cost-benefit analysis. Is there any objection? There is none; it can be tabled. Document, by leave, laid on the Table of the House.

Metiria Turei: Is the Minister denying the evidence of the Victoria University of Wellington Students Association, which reports students—[Interruption]

Mr SPEAKER: Order! Start the question again.

Metiria Turei: Thank you, Mr Speaker. Is the Minister denying the evidence of the Victoria University of Wellington Student Association, which reports students having to spend over 98 percent of their student living costs loans on rent for cold, damp, mouldy homes, which make them sick.

Hon Dr NICK SMITH: The member wisely makes the point that there is a connection between making sure homes are affordable as well as good quality. What the member needs to look at in this bill is the new enforcement provisions. The Government’s view is that rather than spending on a compliance cost that has a warrant of fitness over all 500,000 homes, what we actually need to do is to enforce the existing housing regulations, which many of those student flats breach, and actually give my ministry the powers to prosecute those landlords, and that is what is provided for in the bill. The member may be interested that when I met with the student association, it was very positive about those provisions in the bill.

Metiria Turei: Does the Minister dismiss the evidence of the Auckland Regional Public Health Service, the Public Health Association, and the nurses’ associations, which all say that the bill does not go far enough to protect health and that what is needed is a proper warrant of fitness in this bill?

Hon Dr NICK SMITH: Where those groups are incorrect is that they do not look at the $100 million cost of the bureaucracy of a warrant of fitness over all 500,000 rental properties in New Zealand. And what is a far more sensible response—that is, what is provided for in the bill—is for us to actually focus on those homes that are substandard and breach the current housing regulations, and to actually get on and enforce those. That is a far more sensible approach to this issue than a warrant of fitness over all 500,000 homes.

Metiria Turei: If the Minister will not take the advice of these groups, will he take the advice of Andrew King of the Property Investors Federation, who agrees that cold, damp rental homes are a problem in New Zealand and that the Government should fund power bill vouchers to the 30,000 families with children who have cold-related health conditions from rental properties?

Hon Dr NICK SMITH: Mr King has made very plain to me that he does not support a warrant of fitness. What he would wish is that the Government, either through tax or other grants, pay for the cost of landlords getting their properties up to spec. It is the Government’s view that landlords do have responsibilities, and although through Warm Up New Zealand: Heat Smart we have provided $500 million for insulating houses, landlords also have responsibility to have their rental properties up to standard.

Pharmac—Subsidised Medicines

3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he have confidence in his Minister of Health, given the Minister’s statement regarding funding of Keytruda that Pharmac “haven’t got the money at the moment…that’s the issue”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Andrew Little: Why did he cut health funding in four of his seven Budgets—a total of $1.7 billion—denying Kiwis access to modern medicines like Keytruda?

Rt Hon JOHN KEY: Given that health funding has gone from $11.8 billion to $15.9 billion in the time that I have been Prime Minister, it is not hard to see why the New Zealand public does not take the Leader of the Opposition seriously when he gets up and just makes it up and it is plain wrong.

Andrew Little: How on earth can the Prime Minister possibly say that, when his own Minister said on radio this morning that Pharmac “haven’t got the money at the moment … that’s the issue”?

Rt Hon JOHN KEY: The member needs to read the supplementary questions that they write for him before he comes to the House. What he actually said in his previous question was that health funding had been cut in three Budgets, when it had not. Of course, if Pharmac has more money, by definition, it can fund more drugs. I am quite confident that under this Government Pharmac will get more money. And I am quite confident that, at the moment, Pharmac is undertaking complex commercial negotiations looking at melanoma drugs.

Andrew Little: Given there is no effective front-line treatment for advanced melanoma currently funded, will he tell the cancer sufferers here today why there is money for flag referendums but nothing that is going to help save lives?

Rt Hon JOHN KEY: At the moment, the Government funds about $800 million a year into Pharmac, of which about $131 million goes into cancer treatment. This is a Government that has increased that expenditure and will, I have no doubt, increase it again. One thing we do know about Keytruda, though, is that it is effective for one in three patients who take it; two out of three do not. There are other drugs on the market and other drugs that, potentially, might be more effective, and at the moment Pharmac is in the process of complex negotiations to sort out which one might be best.

Andrew Little: Is he serious in his answer that New Zealanders desperate for this front-line drug might have to wait for the Budget? Knowing that one New Zealander a day is dying from melanoma, that is another 90 people who will give up their lives while they wait for this Government to do something?

Rt Hon JOHN KEY: The Government is working through the process with Pharmac, and I think that is the right way to go. I might simply make the point that, actually, putting Keytruda and the issue of melanoma to one side, there are also a great many other drugs that are unfunded, for which other New Zealanders are dying. So, in the end, it is an allocation of resources. The Government is putting in more money, and it will continue to put in more money.

Andrew Little: Can he not see that those New Zealanders who are suffering from melanoma and are desperate for treatment cannot put that aside, and can he respond to the woman suffering from melanoma whom I spoke to today, who said: “New Zealanders don’t have time for him to piss about on this issue.”?

Mr SPEAKER: Order!

Rt Hon JOHN KEY: In fairness—[Interruption]

Mr SPEAKER: Order! I will let the Prime Minister address the question.

Rt Hon JOHN KEY: In fairness, if one looks at the health system under a National-led Government, not only has its funding increased by more than $4 billion but also the amount of elective surgical operations has increased dramatically, the state of the district health boards has increased dramatically, the amount of money going into cancer drugs has increased, and the amount of money going into Pharmac has increased. We live in a world where there will be more and new biological drugs that will come along, and they will put even more pressure on future Governments. We have a system that we work through, but we are quite conscious of that and we are putting in more money. I just say that we have enormous sympathy with the issues of those individuals at the moment, but there are also other drugs and other issues that get less profile, as well. If the member wants to be fair, he should list all of those, but then, also, he should stop asking for money in certain areas and say he wants it all directed to Pharmac. But that is not actually the policy that Andrew Little is talking about.

Andrew Little: In view of the statements by the Minister of Health this morning, that he has great sympathy for those suffering from melanoma if they have no treatment, is that all that melanoma sufferers in New Zealand can hope for now—sympathy from National Party Ministers?

Hon Annette King: Yeah, good question.

Rt Hon JOHN KEY: Well, actually, no, it is not a very good question, because if the member were listening, he would hear this response: (a) there is more money going into Pharmac; (b) Pharmac is going through complex negotiations; and (c) over time I am confident that we will get these things. At the start of this year, Andrew Little got up and told New Zealanders the most important thing was that youngsters got more money towards a student loan that is already 70 or 80 percent paid by the taxpayers of New Zealand. He did not get up and say: “More money for Keytruda.” He did not get up and say: “More money for other drugs.” He got up and said that students who get 80 percent of their funding already paid for by the taxpayer, who earn more money than the average wage—they are his No. 1—

Mr SPEAKER: Order! [Interruption] Order! The question—[Interruption] Order! The answer to that question was too long.

Andrew Little: How on earth can he, as Prime Minister, plan for tax cuts while Kiwis are dying because of a lack of treatment for melanoma?

Rt Hon JOHN KEY: The member will need to wait for Budget 2016 to see what the priorities are. Under a National-led Government, the health system of New Zealand is run well. Under Annette King, I would have my head down in shame at the way she ran the health system in New Zealand. [Interruption]

Mr SPEAKER: Order! [Interruption] Order! I do not want to specifically mention by name the people who are interjecting too much. [Interruption] Order! The member has been in it all afternoon, actually.

Gang Action Plan—Announcements

4. TODD MULLER (National—Bay of Plenty) to the Minister for Social Development: What recent announcements has she made on the whole of government Gang Action Plan?

Hon ANNE TOLLEY (Minister for Social Development): Today I announced two new community pilots that will support the partners and children of gang members to lead successful lives and help steer young people away from gang life. As part of the Gang Action Plan, these pilots will see the Ministry of Social Development partner with local social service providers to work with gang-connected families and deliver wraparound intensive support services as well as education, employment, and mentoring opportunities. The pilots will also work with gang members who want to leave the gang lifestyle. Total funding for the two trials is $1.1 million over 2.5 years, with more initiatives in other regions to follow soon.

Todd Muller: Why is the Government focused on working with gang members and their families?

Hon ANNE TOLLEY: A report by the Ministry of Social Development released today estimates that gang members and their children cost the taxpayer $714 million through their contact with the ministry and Child, Youth and Family. The report shows nine out 10 gang members have received welfare assistance, costing the taxpayer $525 million. Additionally, over one-quarter of the allegedly abused or neglected children and 60 percent of their children have been victims. Gang life ruins families, and the social cost through domestic violence and child abuse is unacceptable. The new Gang Intelligence Centre involving Police, the Ministry of Social Development, and other Government agencies will give us more detailed information to help address these issues.

Darroch Ball: Why is it taking 2 years to initiate two pilot programmes that do nothing but subsidise current criminal behaviour and do not address the real problem, which is the existence of the gangs themselves?

Hon ANNE TOLLEY: Well, if there was an easy fix to the issue it would have been resolved years ago. This is not an easy fix; it is a very complex area. And because we are seeing the gangs work together, Government is now working together. These trials are working on the ground with gang families who are actually willing to change, because that is the first step to get through, where you have families who do want better outcomes for their children; secondly, to establish providers who are willing to do the work, and that has taken some time to do. You cannot change overnight what has taken generations to produce.

Darroch Ball: Will the Government continue to support criminal gangs by using taxpayer funding to pay for the State houses in which many of these gang members live, or will she support New Zealand First’s calls to ban gang members from living in our community State houses?

Hon ANNE TOLLEY: Well, unfortunately, gang families by their very nature have women and children who are often at the mercy of the gang members, so it is important that we put supports around them. Yes, the welfare statistics are there to show just how many of these gang members are actually reliant on the taxpayer for funding their lifestyles, while at the same time they are making extraordinary amounts of money through their networks, producing methamphetamine. So a whole-of-Government action plan that combines work from both my colleagues the Minister of Police and the Minister of Corrections, and also the social support for their families, are important to address long term the issues of the harm that gangs do. [Interruption]

Mr SPEAKER: Order! [Interruption] Order! Could Darroch Ball please either stop interjecting, or the next time I will be asking him to leave.

Exclusive Economic Zone—Marine Reserves

5. EUGENIE SAGE (Green) to the Minister for the Environment: When he said last year that the Marine Reserves Act “is now outdated. It does not provide for protection in the huge Exclusive Economic Zone”, was he saying that a new Act should provide for new marine reserves in our EEZ; if so, why has his position changed?

Hon Dr NICK SMITH (Minister for the Environment): Marine protection is needed in the exclusive economic zone, and that is why our Government is committed to the Kermadec Ocean Sanctuary, covering 15 percent of the exclusive economic zone. It will provide for an area twice the land size of New Zealand in which mining, fishing, and petroleum drilling will be banned. We have modified our language in the exclusive economic zone from “marine reserve” to “ocean sanctuary”, based on the legal advice that our rights and obligations in the exclusive economic zone are different from those in the territorial sea under international law. For instance, deep-sea cables that would be prohibited in a marine reserve cannot be prohibited in the exclusive economic zone under that law, nor a number of shipping activities. I do not think the public will mind whether it is called an ocean sanctuary or a marine reserve; what they care about is that 15 percent of our exclusive economic zone will be fully protected under this Government.

Eugenie Sage: Does he agree that the reform legislation, apart from the special legislation for the Kermadecs, will do nothing to protect 94 percent of the marine environment—areas where threatened seabirds such as albatross and yellow-eyed penguins feed—and nothing to protect the deep-sea ecosystems that our billion-dollar fishing industry depends on?

Hon Dr NICK SMITH: I think you need to look at the Government’s legislation package as a whole. When you consider that this Government is committing to protecting 15 percent of our exclusive economic zone in the Kermadec area—an area 50 times the size of Fiordland, our biggest conservation area; an area that has got over 50 volcanoes and that has got 20 species of marine life—I would be expecting the Green Party to be congratulating this Government on its marine conservation efforts.

Eugenie Sage: Is the Minister saying that he is comfortable that oil and gas drilling, seabed mining, and fishing can occur throughout the exclusive economic zone without balancing this with a new law that enables some areas within the exclusive economic zone outside the Kermadecs to be protected?

Hon Dr NICK SMITH: We are the very first Government in the 150-plus year history of this nation to set aside an area of the exclusive economic zone for pure protection. I make this further point to the member: the area of the Kermadec Ocean Sanctuary will be the largest no-take, contiguous area of ocean anywhere in the world. New Zealand is setting aside the biggest area anywhere in the world for marine conservation. I think that is something that all members of this House should celebrate.

Scott Simpson: What overall progress has this Government made to improving the management and protection of our marine environment?

Hon Dr NICK SMITH: Our first achievement was in putting in place the exclusive economic zone legislation, because prior to that deep-sea drilling, or any of those activities, could be done out in the exclusive economic zone without any requirement for a consent or any restrictions at all. Our second step has been making real progress on a number of marine reserves that had stalled for years or, in some cases, decades. The three new marine reserves in the Subantarctic Islands, the five new marine reserves on the West Coast, and the new marine reserve at Kaikōura and at Akaroa are all examples of progress in marine conservation under this Government. The last, I would re-emphasise again and about which I have had numerous correspondence from all round the world, is the Prime Minister’s announcement of the Kermadec Ocean Sanctuary, which I think has been welcomed internationally as well as in our own country.

Rt Hon Winston Peters: Can I ask this Minister, if he thinks the history of this country is 150 years—if he thinks that that is an appropriate thing to say in this Parliament, why does he not resign?

Hon Dr NICK SMITH: I openly acknowledge that our Māori people have been here for 800 years, but this institution of Parliament has been going for 150 years, and I say again—I say again—that this Parliament has never made as good a progress in marine conservation as it has under this Government.

Eugenie Sage: Given the widespread support for the Kermadec Ocean Sanctuary, is he really convinced that his new marine protected areas legislation cannot provide a simple process to create new marine protected areas in the exclusive economic zone, which comprises 94 percent of our ocean environment?

Hon Dr NICK SMITH: As I have said to the member, we are setting aside 15 percent of that exclusive economic zone with the Kermadec legislation. In respect of the marine protected area proposals providing for four different types of marine protection tools, species-specific sanctuaries, seabed reserves, and marine reserves, as well as recreational fishing parks, they are more appropriate for the territorial sea. For instance, it is perfectly proper for local communities to have a say in their sea immediately adjacent to their community, but it is the Government’s view that, in respect of the exclusive economic zone, the more appropriate way is special legislation, and that is exactly what we are doing with the Kermadec Islands.

Health, Minister—Statements

6. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health: Does he stand by all his statements?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes, within in the context that they were made.

Hon Annette King: Does he stand by his statement on Radio New Zealand this morning regarding unfunded drugs for melanoma patients that “365 deaths a year—it works in one-third of patients, so, you know, 120-odd could benefit”; if so, are these 120 people not worth saving?

Hon Dr JONATHAN COLEMAN: To the first question, yes.

Hon Annette King: Is he satisfied with the current standard treatment for advanced melanoma, even though cancer specialists are telling him it does not work, and the only people able to access life-saving drug therapy are those who are able to raise the money?

Hon Dr JONATHAN COLEMAN: The point is there are new drugs available. Pharmac is in complex commercial negotiations that are now looking at which might be the most appropriate to fund. The issue is, really, at the next Budget, when we have a bid for health, that if we get more money it means that more pharmaceuticals can be funded.

Hon Annette King: Does he stand by his admission on The Paul Henry Show this morning that the Ministry of Health has not got the money to fund Pharmac; if so, will he also now admit what everybody knows, which is that health has been underfunded by $1.7 billion under this Government?

Hon Dr JONATHAN COLEMAN: What I said was that the $800 million that Pharmac gets is totally accounted for—and that member is totally incorrect going around saying that there have been cuts to the health budget. There have not; funding has gone up by $4 billion under this Budget—and she should stop saying that, because she is misleading the public of New Zealand.

Hon Annette King: Has underfunding of health, especially Pharmac, led to New Zealand now being last out of 20 comparable OECD countries for access to innovative medicines, with 81 medicines waiting to be funded by Pharmac, with an average wait of 3 years?

Hon Dr JONATHAN COLEMAN: What I can tell the member is that public health spending in New Zealand is higher than Australia as a percentage of GDP [Interruption]. It is I am afraid—sorry, that is the truth.

Hon Annette King: Why did he say on Radio New Zealand this morning that petitioner Leisa Renwick “asked for a meeting sometime after 1.30 p.m. today”, when she started emailing him on 18 February, offered to meet him anytime—over breakfast or even accompany him to a rugby fixture—if he would just meet with her? Was he being straight with the public when he said that?

Hon Dr JONATHAN COLEMAN: The member is misrepresenting what is in those emails, and, actually, as you know, I have met with Mrs Renwick today out on the forecourt, because you were there.

Hon Annette King: I seek leave to table Leisa Renwick’s emails to the Minister so I am not misrepresenting her—

Mr SPEAKER: Order! We do not need that part added.

Hon Annette King:—dating back to 18 February, seeking a meeting with him at any time.

Mr SPEAKER: Leave is sought to table those particular—[Interruption] Order! Leave is sought to table those emails. Is there any objection? They can be tabled. Documents, by leave, laid on the Table of the House.

Hon Annette King: So he lied.

Mr SPEAKER: Order! The member will stand and withdraw that remark immediately.

Hon Annette King: I withdraw, Mr Speaker.

Roading, Waikato—Waikato Expressway

7. DAVID BENNETT (National—Hamilton East) to the Minister of Transport: What recent progress has the Government made on the Waikato Expressway Road of National Significance?

Hon SIMON BRIDGES (Minister of Transport): It was my privilege to open late last year the Cambridge section of the $2.1 billion Waikato Expressway. This new $250 million stretch of road was delivered 6 months ahead of schedule and under budget. The new highway has significantly improved safety on the current State Highway 1, created a new gateway to Cambridge, and removed congestion in the town centre. Completion of the Cambridge section is a major milestone on the journey to complete the entire 102 kilometre Waikato Expressway project by 2020. The expressway will be a game-changer for the region, and is a good example of the Government’s focus on building infrastructure that will drive New Zealand’s economic success and greatly improve safety.

David Bennett: What reports has he seen on how the new Cambridge section of the Waikato Expressway is benefiting motorists?

Hon SIMON BRIDGES: I have seen a report from the Transport Agency that says that an impressive 15,000 vehicles per day have been using the new road since it opened in December, and I am pleased to say that people are shaving up to 23 minutes off their daily commute between Cambridge and Hamilton, using the new section of the Waikato Expressway. That is up to 23 minutes a day on a round trip that people do not have to spend sitting in their cars. Along with time savings this also saves people money on fuel and shows the real benefits that the Cambridge section of the expressway is delivering for commuters in the Waikato.

Government Financial Position—Crown Debt

8. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: What was the dollar figure of net core Crown debt when he took office as Minister, and what is that dollar figure today?

Hon BILL ENGLISH (Minister of Finance): In 2008-09 core Crown net debt was $17.1 billion or 9.1 percent of GDP. Net debt in 2014-15 was $60.6 billion, or 25.2 percent of GDP. In between, we had the world’s most significant financial crisis since the Great Depression, and we had to borrow $17 billion to rebuild Christchurch. Every proposition I have seen from the Labour Party since would drive debt up.

Grant Robertson: Has he seen the report by Citigroup entitled “Here Comes a Global Recession”, and what is he prepared to do to change his approach to managing the economy to meet that challenge?

Hon BILL ENGLISH: I do not have to read Citigroup’s voluminous commentary to hear about coming recession, because the Labour Party has been predicting it the whole time the economy has been growing. About every second week, it predicts a recession, so, no, I have not read that report.

Barbara Kuriger: What steps has the Government taken to return the books to surplus and get on top of debt?

Hon BILL ENGLISH: The Government is focused on careful management of new spending. In the last seven Budgets we have spent an average of $680 million in discretionary spend each Budget, compared with an average of $3 billion per year in the 7 years before that. We have also focused on getting more for less out of existing public services, not just new ones, and that has meant pursuing, with some vigour, value for money in our large spending areas, such as education, in health, in the justice system, and also in welfare, using some more innovative techniques that are starting to show long-term benefits.

Grant Robertson: Does he stand by his statement in November 2008, when net debt was $50 billion less than it is today: “I want to stress that New Zealand starts from a reasonable position in dealing with the uncertainty of the economic outlook.”?

Hon BILL ENGLISH: In respect of net debt levels, yes, but of course in respect of the policy settings left behind by the disastrous management of the previous Labour Government, no.

Grant Robertson: Does he recall saying in November 2008 “In New Zealand we have room to respond. This is the rainy day that the Government has been saving up for.”, and how are we placed for an upcoming rainy day with $50 billion extra debt?

Hon BILL ENGLISH: I did say that, and I must say that since then my appreciation of the skills of Dr Cullen as a Labour finance Minister has grown enormously. He had much more understanding and ability to deliver on these things than any of the six finance spokesmen since.

Simon O’Connor: What other approaches has the Minister seen to managing the Government’s books?

Hon BILL ENGLISH: I have seen proposals just in the last few months for increased spending on public sector wages, infrastructure, education, health, tertiary education, social services, the Venture Investment Fund, and the Superannuation Fund. All of these have come from the Labour Party, which is advocating that we have got too much debt.

Grant Robertson: Is it not true that his failure to grow the New Zealand economy in real terms means that our borrowing is tens of billions of dollars higher and that the rainy day that is coming now we are not prepared for, as we were in 2008?

Hon BILL ENGLISH: No, I would disagree with that. In 2008, although Government debt levels were low, it was the product of a time when nominal GDP had grown very rapidly. Inflation was 5 percent, first mortgage interest rates then were 10 percent—so, although debt levels were low, the economy was in very poor shape. This time round, debt levels are higher because they have had to be to run a decent community and decent support for the New Zealand people, but our economy is in much better shape than it was in 2008.

Freshwater Management—Farming Practices and Protection of Water Quality

9. STUART SMITH (National—Kaikōura) to the Minister for the Environment: What progress is the Government making on improving management of fresh water, and particularly in addressing the problem of stock polluting rivers, lakes, and wetlands?

Hon Dr NICK SMITH (Minister for the Environment): We have been progressively moving to strengthen national standards for fresh water, firstly, with the compulsory regulations in 2009 that require the metering of all water takes; the first national policy statement under the Resource Management Act on fresh water in 2001; and the national bottom lines to maintain or improve water quality that were brought in, in 2014. At the Bluegreens Forum on 20 February I announced with the Minister for Primary Industries, Nathan Guy, national regulations that progressively require fencing of stock out of waterways, starting with dairy and pig farms by July 2017, dairy support by 2020, followed by beef and deer farms by 2025 and 2030 relative to the steepness of the country. The proposal has been developed by the Land and Water Forum involving Federated Farmers and key environmental NGOs, and is a successful product of this collaborative model of resolving environmental issues.

Stuart Smith: How much has the Government invested in freshwater clean-up projects and what improvements in freshwater quality have been achieved?

Hon Dr NICK SMITH: This Government has spent $125 million on freshwater clean-ups over the last 7 years. That compares with just $17 million over the previous 7 years. Lake Rotoiti is one of those projects. That has improved hugely: a decade ago it was regularly having toxic algae blooms; today all the data shows a marked improvement in this popular recreational lake. I was recently with Maureen Pugh on the West Coast at its largest lake, Lake Brunner. There with Government funding there are substantial improvements in water quality. The third I would mention would be our largest lake, Lake Taupō, where we are 3 years ahead of schedule in reducing nitrogen runoff into that very significant lake.

Stuart Smith: How does the Government support in investment for water storage projects help towards the goal of water quality improvements?

Hon Dr NICK SMITH: Water storage infrastructure can have a very positive contribution to water quality. I draw members’ attention to the Central Plains Water scheme in Canterbury, which involves substituting aquifer-drawn irrigation with reticulated water from Lake Coleridge and the Rākaia River. The excessive draw-down of water from aquifers and smaller rivers is at the core of Canterbury’s water issues. The new scheme also puts far tighter requirements on farms for nutrient management. Another good example is the Ōpuha scheme, where in the most recent droughts Fish and Game was transferring fish out of other water bodies, because they were so dry, to the one that actually had the flows that could maintain that aquatic life. I also note in my own area that water storage schemes will provide for dryland farming to be converted into crops like apples that actually reduce the amount of nutrients.

Prime Minister—Statements

10. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he stand by all his statements; if so, why?

Rt Hon JOHN KEY (Prime Minister): Yes, in the context they were given, because I do.

Rt Hon Winston Peters: Does he stand by his answer yesterday on the rail line north of Whangarei—and apologies for the grammar, but I quote him: “I think it’s the opposite. I don’t think there’s any plans to close it.”?

Rt Hon JOHN KEY: Yes, I do stand by that statement. In fact, I have the exact transcript of that, and it was words to the effect of something about closing the line, and as we know, the line is not being closed.

Rt Hon Winston Peters: How does he reconcile that answer with the written statement of KiwiRail’s Steve Muir, Manager Bulk and Forestry, just 2 weeks ago: “We will also not be running trains north of Kauri from 1 September.”?

Rt Hon JOHN KEY: In the interests of the last question, the exact question from the media was: “Are you aware of any plans to close the rail line north of Whangarei?”. As I have just stated to the House, the rail line north of Whangarei is not closing. There have been issues in relation to the commercial contractor on that line, and the contract has not been renewed, because the contractor is not prepared to pay commercial rates. If somebody else wants to pay commercial rates, or that party wants to come back and pay more commercial rates, then they can operate. But the line is not closing.

Rt Hon Winston Peters: Could I ask the Prime Minister why he is engaging in bulldust on this matter, when everyone up there knows that if there are no trains on the line, then the railway line service is over; why is he engaging in such obfuscation and bandying words around that mean nothing—

Mr SPEAKER: Order! The question has been asked.

Rt Hon JOHN KEY: If I wanted to look at an expert in bulldust, all I would do is look across the House. The member has a PhD in it.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. If the Prime Minister wants to engage in that sort of behaviour, which I think is unparliamentary—[Interruption] I just want to remind him that the last time he tried it he got dusted-up up north.

Mr SPEAKER: Order! I think the supplementary question was the question that led off to where the answer then got to.

Rt Hon Winston Peters: To the Prime Minister—[Interruption] That is “sir” to you. Why did he allow the Minister of Transport, on 20 October last year, to give assurances that there are no railway closures planned for Northland, when separate correspondence from KiwiRail, on the Portland line, means that those assurances were categorically, deliberately false?

Rt Hon JOHN KEY: Because the Minister of Transport was correct.

Rt Hon Winston Peters: How could the Minister of Transport be telling the truth, when the correspondence from KiwiRail shows that the Portland line is to be closed in favour of a metal road, and that is in the documentation?

Rt Hon JOHN KEY: The advice I have had from the Minister of Transport is that he refutes that assertion.

Rt Hon Winston Peters: I seek leave to table the correspondence from KiwiRail as to the Portland line shunting-line closure, covering 3 miles, and second, the railway line north of Kauri—

Mr SPEAKER: Order! I simply need now how many letters the member is seeking to table—KiwiRail letters—and the dates of those letters before I put the leave.

Rt Hon Winston Peters: Fortunately two, on two different matters.

Mr SPEAKER: And they are dated last year, I take it?

Rt Hon Winston Peters: I beg your pardon?

Mr SPEAKER: What dates are the letters?

Rt Hon Winston Peters: They are 27 October, and February of last year and February of this year.

Mr SPEAKER: Leave is sought to table those two KiwiRail letters. Is there any objection to them being tabled? There is none. They can be tabled. Documents, by leave, laid on the Table of the House.

Sue Moroney: Point of order—[Interruption]

Mr SPEAKER: Order! A point of order has been called.

Sue Moroney: I seek leave to table a transcript of the 2014-15 annual review of KiwiRail, where the chief executive officer says: “At this stage there is no rail—

Mr SPEAKER: Order! I need no more assistance. If that is a transcript from a select committee, it is available to all members if they so want it.

Sue Moroney: I raise a point of order, Mr Speaker.

Mr SPEAKER: Are you speaking to the point of order?

Sue Moroney: Yes. I believe the transcript is not yet publicly available.

Mr SPEAKER: If it has been before a select committee, it is available via the e-committee process. It is, therefore, available to all members if they want it.

Trans-Pacific Partnership—Horticulture Industry

11. MAUREEN PUGH (National) to the Minister for Primary Industries: How will the Trans-Pacific Partnership support growth in our horticulture industry?

Hon NATHAN GUY (Minister for Primary Industries): The Trans-Pacific Partnership (TPP) will save the horticulture industry an estimated $26.3 million per year when fully implemented. Horticulture is New Zealand’s fourth-largest export earner, sending products to more than 120 countries, and it is valued at around $4 billion of exports per year. New Zealand exports a diverse range of premium fruit and vegetable products. The TPP will allow these products to better compete in key markets such as Japan, the USA, and Viet Nam.

Maureen Pugh: What reports has he received about the importance of this agreement to the horticulture industry?

Hon NATHAN GUY: Horticulture New Zealand Chief Executive Mike Chapman has said that the removal of these tariffs does not just mean savings for growers exporting now; it means the products they export in the future will be more competitively priced and will challenge the offerings from other countries. He goes on to add that an agreement like TPP is overwhelmingly welcomed by growers. I received very similar feedback last week in the Bay of Plenty from growers who are welcoming the TPP.

Maureen Pugh: What are some other ways in which the Government is supporting the horticultural industry?

Hon NATHAN GUY: Good question. Last week I was in Tauranga for the deed-signing of a Government industry agreement, the biosecurity readiness and response between Avocado Growers Association Inc. and the Government. Avocados are the seventh industry signatory to the Government industry agreement. The agreement gives industry the opportunity to influence biosecurity readiness and response and how they impact overall. This partnership approach is evidenced in the successful Biosecurity Operational Excellence scheme at the Port of Tauranga. This is being driven by the Government industry agreement partner of Kiwifruit Vine Health, alongside the Port of Tauranga, the Ministry for Primary Industries, local government, and industry organisations. It is about increasing the overall biosecurity awareness for port workers.

Economic Development, Minister—Saudi Agri-hub and Ministerial Involvement

12. Hon DAVID PARKER (Labour) to the Minister for Economic Development: Does he stand by the statement reportedly made on his behalf two weeks ago that the Saudi sheep deal is Murray McCully’s and all questions should be directed at him?

Hon STEVEN JOYCE (Minister for Economic Development): Yes, I stand by the fact that, in response to a media inquiry as to who they should speak to about the Saudi agri-hub, my press secretary responded that the Minister of Foreign Affairs is the Minister responsible for this issue, and that is because he is.

Hon David Parker: Does he deny that his office also contacted a journalist to complain that Radio New Zealand had mentioned him, Mr Joyce, in a Saudi sheep story?

Hon STEVEN JOYCE: I do deny that, because I understand from the press secretary that it was not a complaint at all.

Hon David Parker: Does his office often phone up journalists asking that Mr Joyce’s name not be associated with Murray McCully’s deals?

Hon STEVEN JOYCE: No, not at all. I enjoy being associated with my friend Mr Murray McCully, whom I have known for many years, and he is a very efficient and effective Minister of Foreign Affairs.

Hon David Parker: Does he accept that his department New Zealand Trade and Enterprise has primary responsibility to administer the millions his Government is spending on this Saudi farm in the desert; if so, why has he repeatedly refused to answer parliamentary and media questions?

Hon STEVEN JOYCE: The member may recall there was a Cabinet document put up by Mr McCully—which is in the public domain—in February 2013 that has been provided to the Labour Party, where Mr McCully took the lead on that issue. He has asked New Zealand Trade and Enterprise to manage that issue, which, as far as I am concerned, it is doing well, but Mr McCully has retained the leadership on that issue.

Hon David Parker: I raise a point of order, Mr Speaker. I think my question was pretty direct—

Mr SPEAKER: Order! No, there were two parts to your question and the second part has now been addressed.

Hon Gerry Brownlee: Another question from Radio New Zealand—oh, sorry, Radio Labour.

Hon David Parker: I hope the media heard that.

Mr SPEAKER: Order! I did not hear the interjection, but the interjection from Mr Brownlee will cease—[Interruption] Order!

Hon David Parker: Will the Minister assure Parliament today that, in his opinion, all parts of the Saudi sheep deal with the Al-Khalaf Group are 100-percent proper and complied with Government procurement and appropriation rules?

Hon STEVEN JOYCE: To my knowledge, yes, but the reality is that particular arrangement is run by Mr McCully. I know the member put down some questions to him a couple of weeks ago, and I think they were satisfactorily answered.

Hon David Parker: Is the reason that his staff have said to the media that all questions about the Saudi sheep deal should be directed to Murray McCully because he does not want to be tainted?

Hon STEVEN JOYCE: The member, I think he is wasting the House’s time—I genuinely believe that is what he is doing. He is so far going down the rabbit-hole, he is going to hit his own tail shortly. On the Saudi agri-hub, Minister McCully has worked with both the Ministry of Foreign Affairs and New Zealand Trade and Enterprise. He put up a Cabinet paper; Cabinet agreed to it. The member needs to find something to do with his time.


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